Carnival (NYSE:CCL) Given New $0.00 Price Target at Morgan Stanley
Welcome to Issue 083 of Masters in Trading Digest.
Yes, you read that correctly, Morgan Stanley just shared multiple reasons why Carnival Cruise has the potential to trade $0.
As reported in Forbes, “The firm warned in a worst-case scenario Carnival’s stock could fall to $0 per share and lose all of its value if the economy falls into a recession and the company faces another demand shock.
The article continued, that given Carnival’s high debt levels (over $35 billion), the company’s liquidity and cash pile, which stood at $7.5 billion by the end of the second quarter, could “quickly shrink” if bookings slow or more customers cancel deposits, Morgan Stanley analysts wrote”.
This is BIG news, but doesn’t it seem a bit outrageous to you?
The actual price target Morgan Stanley has for Carnival is $7 but to share reasons for a $0 price target (at least in my opinion) seems a bit dramatic, almost like someone is trying to shock the market, or perhaps – spike volatility in CCL?
Maybe that’s why the Wall Street Wiretapper found unusual trading behavior in CCL options contracts from June 09 to June 17, 2022, right before the stock dropped 20%.
The last time we found unusual trading behavior like this in CCL options was back in April, here’s trades from April 05 – April 14, 2022.
The chart below shares the trading behavior proceeding with these large options trades.
- April 05
- June 09
This is also the reason Stacy Brovitz, CFA shared a trade idea with our members on June 12th, suggesting traders follow the “smart money” and consider buying options on CCL to bet on an increase in volatility.
The trade cost $127 to enter, and Thursday was worth $250+
MEMBER NOTES
Enjoy the holiday weekend.
This week's option trades will be shared Monday, and our live trading session will be held Tuesday, at 11:00 AM EST.
We trade ideas daily in our Discord community with options members.
If you want to learn more about our Options Membership, we share exactly why you want to “Follow the Smart Money” in this presentation.
Masters in Trading Digest - Issue 83
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FINAL THOUGHTS
WHAT TO EXPECT IN THE NEXT MIT DIGEST
In case you missed it, here are 5 Trading Secrets Successful Options Traders Use to Find Low-Risk, Winning Trades In Any Market…
… please take a few seconds to download this report below, right now before it expires.
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That sounds like a square deal, right?
The 5 Trading Secrets Successful Options Traders Use to Find Low-Risk, Winning Trades In Any Market.
As always, share your feedback on the Digest and keep up with the fantastic suggestions for upcoming issues.
Until then, trade smart and always manage your tail risk.
Thanks for reading,
Jonathan Rose
P.S. Don’t delay your decision for much longer. Because like I’ve been saying, this free resource is only available for a limited time. Here’s a sneak peek of what you will learn:
- CBOE Market Maker shares the reality behind how market makers value options – an important perspective for all traders. (Page #06)
- How to quickly find the odds to see if your option position will become profitable – this is a must-know. (Page #12)
- Position Management Tips – Imagine turning losing trades into winning trades and now learn about Scalping Gamma (Page #11)
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